Deck 11: Strategic Pay Plans

Question 1

Research conducted by WorldatWork has clarified the "work experience"category of total rewards by splitting it into three parts.They are

A)work/life programs, succession programs, and salary grade.
B)work/life programs, performance and recognition, and development and career opportunities.
C)work/life programs, business strategy, and development/career opportunities.
D)work/life programs, HR strategy, and development/career opportunities.
E)work/life programs, organizational culture, and development/career opportunities.

Answer 1

B

Question 2

Job evaluation is a technique used to determine

A)performance appraisals of individuals to the group.
B)promotability.
C)merit reviews of individuals to the group.
D)the relative value of an individual's career earnings to the group's.
E)the relative worth of each job.

Answer 2

E

Question 3

The basic procedure of job evaluation is to compare the content of jobs in relation to one another in terms of all of the following except

A)effort.
B)responsibility.
C)working conditions.
D)personality traits.
E)skill.

Answer 3

D

Question 4

Pay equity laws were enacted in response to

A)pay discrimination against senior citizens.
B)the variety of compensable factors being used to evaluate jobs.
C)the historical undervaluing of "women's work."
D)gender-neutral job evaluation systems.
E)the variety of job evaluation systems being used to evaluate jobs.

Question 5

A total rewards approach considers

A)cost constraints.
B)business strategy.
C)individual reward components as part of an integrated whole.
D)employee value.
E)compensation and benefits together.

Question 6

Compensation policies are usually written by the HR or compensation manager together with

A)supervisors.
B)employees.
C)stockholders.
D)compensation consultants.
E)senior management.

Question 7

Total rewards refers to

A)payroll costs.
B)all forms of pay or other compensation provided to employees.
C)cash payments only.
D)certain forms of pay and rewards to employees.
E)contractual pay methods or fringe benefits to employees.

Question 8

Work/life programs help employees do their jobs effectively using

A)flexible scheduling and childcare.
B)vacation and holidays.
C)employer-paid insurance.
D)advancement opportunities.
E)recognition programs.

Question 9

Most Canadian human rights acts prohibit discrimination in pay based on all of the following grounds except

A)sex.
B)age.
C)physical disability.
D)height.
E)colour.

Question 10

The Revlex Company did a salary survey and the results showed that 10 of its key positions had lower wages compared with similar positions at their key competitors.The problem the company faces is

A)comparable worth.
B)pay equity.
C)external equity.
D)internal inequity.
E)broadbanding.

Question 11

Unions tend to believe that no one can judge the relative worth of jobs better than

A)management.
B)HR staff.
C)job evaluation consultants.
D)union leaders.
E)workers.

Question 12

The Employment Insurance Act provides unemployment benefits varying by region and other factors for up to ________ weeks.

A)30
B)45
C)52
D)26
E)18

Question 13

You are advising the President of a newly formed company as to payroll obligations.This company is provincially regulated and is located in British Columbia.She has asked you to advise her as to legislative minimum standards regarding pay.You respond that the British Columbia Employment Standards Act sets minimum standards regarding pay for each of the following categories except

A)paid vacation.
B)minimum wage.
C)paid statutory holidays.
D)overtime pay.
E)pensions.

Question 14

Engagement is

A)providing competitive base pay.
B)transactional rewards which are consistent across competing organizations.
C)a positive emotional connection to the employer and a clear understanding of the strategic significance of the job.
D)the belief that the organization cares about talent management.
E)relational work experiences.

Question 15

Total rewards are conceptualized by WorldatWork as having three broad categories.They are

A)development/career opportunities, benefits, and work experience.
B)bonus, benefits, and work experience.
C)compensation, benefits, and non-monetary rewards.
D)compensation, flexible benefits, and work experience.
E)performance and recognition, benefits, and work experience.

Question 16

Important considerations for paying employees include all the following except

A)equity considerations.
B)legal considerations.
C)average age considerations.
D)union considerations.
E)policy considerations.

Question 17

Job evaluation involves comparing jobs to one another based on their content.Job content is assessed using

A)critical incidence.
B)job design.
C)comparable worth.
D)behavioural anchors.
E)compensable factors.

Question 18

Pay rates must be equitable for each employee relative to other pay rates inside the organization.This is known as

A)need for equity.
B)internal equity.
C)compensation plan.
D)external equity.
E)wage compensation.

Question 19

The total rewards approach has arisen from the

A)organization's business needs.
B)executive boardroom.
C)changing global economy.
D)employee's requirement for stability.
E)changing business environment of the last several decades.

Question 20

Wages must compare favourably with rates in other organizations or an employer will find it hard to attract and retain qualified employees.This is known as

A)compensation policy.
B)internal equity.
C)wage compensation.
D)external equity.
E)need for equity.

Question 21

A disadvantage of the job classification method of job evaluation is the difficulty in

A)grouping jobs.
B)classifying jobs.
C)writing job descriptions.
D)writing grade descriptions.
E)developing job clusters.

Question 22

The following are all primary functions of the job evaluation committee except

A)evaluating the worth of each job.
B)selecting a job evaluation method.
C)identifying 10 or 15 key benchmark jobs.
D)selecting behavioural anchors.
E)selecting compensable factors.

Question 23

The job evaluation method that rates each job relative to all other jobs, usually based on some overall factor like "job difficulty,"is the

A)critical incidence method.
B)factor comparison method.
C)classification method.
D)point method plan.
E)ranking method.

Question 24

An example of an informal survey conducted by an employer would be a(n)

A)governmental agency survey.
B)professional organization survey.
C)telephone survey.
D)industry-wide survey.
E)commercial survey.

Question 25

The process whereby several people meet together who are familiar with the jobs in question, and who may have different perspectives regarding the nature of the jobs, is called a

A)performance appraisal.
B)job evaluation committee.
C)union negotiating team.
D)management negotiating team.
E)position review committee.

Question 26

Establishing pay rates involves three stages, which are

A)job evaluation, conducting salary surveys, and combining job evaluation and salary survey results.
B)consulting with industry, determining salaries for executive positions, and deciding on a benefits plan.
C)pricing of benchmark jobs, collecting data on insurance benefits, and evaluating benefits packages.
D)collecting data on insurance benefits, creating a salary survey, and hiring external consultants.
E)collecting data used to price every job in the organization, working with a compensation consultant, and working with a benefits specialist.

Question 27

Statistics Canada provides monthly data on earnings by

A)geographic area and size of company.
B)size of company.
C)industry and city.
D)geographic area, industry, and occupation.
E)city and occupation.

Question 28

The type of job evaluation method where the groups are called classes if they contain similar jobs is called the

A)ranking method.
B)point method.
C)Hay plan method.
D)job classification method.
E)factor comparison method.

Question 29

In establishing pay rates, an employer should conduct a salary survey for the purpose of

A)fine tuning pay rates.
B)pricing jobs.
C)job evaluation.
D)performance appraisals.
E)slotting jobs into pay grades.

Question 30

Job evaluation is mostly a judgmental process which requires close cooperation and input from all of the following except

A)customer responses.
B)compensation specialists.
C)union representatives.
D)supervisors.
E)employees.

Question 31

Another way to categorize jobs when undertaking the job classification method, other than using class descriptions, is to

A)draw up a set of classifying rules.
B)rank jobs by compensable factors.
C)rank jobs against one another.
D)assign points to compensable factors.
E)rank jobs from lowest to highest.

Question 32

Once a job evaluation method has been used to determine the relative worth of each job, the committee can turn to the task of assigning pay rates to each job, but it will usually want to first group jobs into

A)labour contracts.
B)range rates.
C)personal contracts.
D)department classes.
E)pay grades.

Question 33

The job evaluation method in which a number of compensable factors are identified, and then the degree to which each of these factors is present on the job is determined, is the

A)factor comparison method.
B)ranking method.
C)point method.
D)Hay plan method.
E)job classification method.

Question 34

Wage surveys undertaken by the human resources department may collect other data which would include all of the following except

A)sick leave benefits.
B)vacation time.
C)industry demand.
D)employee benefits.
E)insurance benefits.

Question 35

The job evaluation committee will want to group similar jobs (in terms of their ranking or number of points, for instance)into grades for

A)personal growth.
B)pay purposes.
C)assessment purposes.
D)wage structure purposes.
E)non-economic reasons.

Question 36

The job classification method of job evaluation is a widely used method in which jobs are categorized into

A)functions.
B)groups.
C)factors.
D)clusters.
E)departments.

Question 37

The point method of job evaluation identifies several compensable factors, each having several degrees, in addition to

A)degrees to which each of these factors is present in the job.
B)degrees within a present job.
C)identifying behavioural anchors.
D)establishing points in ranking jobs.
E)ranking jobs.

Question 38

Jeffrey is the newly hired HR professional who is responsible for evaluating compensation practices at the company.To determine if there are issues with internal equity, he has chosen to conduct a job evaluation according to the method popularized by the Hay consulting firm.Which of the following are the compensable factors he uses to evaluate jobs?

A)skill, effort, problem solving, and working conditions
B)responsibility, skill, effort, and working conditions
C)know-how, problem solving, accountability, and working conditions
D)effort, responsibility, authority, and working conditions
E)knowledge, problem solving, responsibility, and working conditions

Question 39

The classification method is widely used

A)in small businesses.
B)in leading-edge Fortune 500 businesses.
C)in the public sector.
D)for technicians/technologists in hospitals.
E)for executive positions that are too difficult to assess using other methods.

Question 40

The problem resulting from using data in employee compensation surveys is known as

A)employee discrimination.
B)upward bias.
C)systemic undervaluing.
D)stereotyping of data.
E)report bias.

Question 41

The rate range is usually built around the

A)job evaluation.
B)wage line or curve.
C)performance appraisal.
D)job specialization.
E)Hay system.

Question 42

An advantage of using rate ranges for each pay grade is that it allows for

A)age differences.
B)gender differences.
C)education differences.
D)employer inflexibility.
E)performance differences.

Question 43

Collapsing salary grades and ranges into just a few wide levels or "bands"is called

A)broadbanding.
B)job specialization.
C)wide banding.
D)compensation banding.
E)red circle banding.

Question 44

The graphic description of the relationship between the value of the job and the average wage paid for this job is called a

A)pay grade.
B)wage curve.
C)rate range.
D)wage structure.
E)wage grade.

Question 45

There are several steps in pricing jobs with a wage curve.The second is to

A)price jobs.
B)determine the rate range.
C)find the average pay for each pay grade.
D)create a wage line.
E)plot the pay rates.

Question 46

There may be more opportunities for advancement with skill-based pay plans than with job-based pay plans because of

A)less bureaucracy.
B)the lack of job evaluation.
C)higher base pay.
D)exposure to multiple jobs requiring multiple competencies.
E)the emphasis on years of experience.

Question 47

Rate ranges are a series of steps or levels of pay within a pay grade, usually based upon

A)peer appraisals.
B)years of education.
C)years of service.
D)teamwork.
E)amount of responsibility.

Question 48

Broadbanding facilitates less specialized, boundaryless

A)jobs and organizations.
B)division of work.
C)job evaluation.
D)geographic dispersion.
E)leniency and error.

Question 49

The great challenge of competency-based pay is

A)competency definition.
B)educational levels of employees.
C)measurement of skills, abilities, and competencies.
D)determining bonuses.
E)determining base pay.

Question 50

Executive compensation tends to emphasize ________ more than for other employees' pay plans.

A)salary
B)commissions
C)performance incentives
D)benefits
E)base pay

Question 51

With skill/competency-based pay, employees are not paid for the job they currently hold, but instead for all the following except

A)knowledge.
B)depth of skills.
C)years of experience.
D)types of skills.
E)range of skills.

Question 52

A wage survey that pertains to members of associations might involve

A)Professional Engineers Ontario.
B)geographic surveys.
C)area surveys.
D)local surveys.
E)benefits surveys.

Question 53

Rates being paid to overpaid employees are often called

A)red circle pay rates.
B)premium jobs pay rates.
C)excessive pay rates.
D)silver circle pay rates.
E)black circle pay rates.

Question 54

Experience has shown that competency-based pay is more efficient in the ________ years of its existence.

A)first
B)later
C)first 10
D)first 5
E)last

Question 55

One way to depict the pay rate ranges for each pay grade is with a wage structure graphically depicting the

A)range of pay grades for each pay rate.
B)range of pay rates for each pay grade.
C)range of jobs.
D)pay for each job.
E)scatter-plot points within a pay grade.

Question 56

When developing compensation plans for managers and professionals, job evaluation is central to

A)non-salary issues.
B)benefits.
C)incentives.
D)bonuses.
E)base salary.

Question 57

An alternative method to a traditional job evaluation is pay

A)based on seniority.
B)for education.
C)for skill/competency.
D)for responsibility.
E)for ability.

Question 58

Assigning pay rates to each pay grade (or to each job)is usually accomplished with a

A)rate range.
B)job evaluation.
C)wage grade.
D)wage curve.
E)performance appraisal.

Question 59

The problem with having a wage structure with underpaid employees can be solved through raising their wages to

A)another pay grade.
B)the midrange of an employee's pay grade.
C)the minimum of the rate range for their pay grade.
D)the maximum of the rate range for their pay grade.
E)be competitive with other jobs in the firm.

Question 60

There are several steps in pricing jobs with a wage curve.The first is to

A)create a wage line.
B)find the average pay for each pay grade.
C)determine the pay grade.
D)determine the pay rate for a cluster of jobs.
E)determine the rate range.

Question 61

Most of the pay equity acts in Canada focus on four compensable factors-skill, effort, responsibility, and working conditions.

Question 62

The point method plan of job evaluation identifies several compensable factors, each having several degrees, as well as the degree to which each of these factors is present in the job.

Question 63

The point method of job evaluation is easily explained to employees.

Question 64

Human rights legislation makes it illegal to discriminate in employment because of race, colour, religion, sex, and age.

Question 65

The only way to categorize jobs is to draw up class descriptions and place jobs into classes based on their correspondence to these descriptions.

Question 66

When compensating professional employees, compensable factors tend to focus on all of the following except

A)creativity.
B)technical knowledge.
C)technical expertise.
D)problem solving.
E)working conditions.

Question 67

Management does not have the right to serve on a job evaluation committee, because this would constitute a conflict of interest.

Question 68

Total rewards refers to all forms of pay or other compensation arising from employment.

Question 69

When compensating professional employees, the most commonly used job evaluation method is

A)point.
B)competency.
C)ranking.
D)job classification method.
E)factor comparison.

Question 70

The general trend in executive compensation today is to decrease the relative importance of ________ and increase the relative importance of short- and long-term executive incentives.

A)employee benefits
B)perquisites
C)pension plans
D)base salary
E)commissions

Question 71

You are the HR professional at a forestry company in New Brunswick.Regarding pay equity, you should

A)hire pay equity consultants to develop a pay equity plan if you don't have one already, since pay equity is required in New Brunswick.
B)not worry about pay equity at all since the rates are set through negotiation with the union.
C)review pay rates for gender bias and monitor legislative requirements.
D)make sure that some women are promoted into higher-paying jobs to satisfy quota requirements.
E)initiate a plan to systematically reduce over-paid male employees by red-circling their wages.

Question 72

In most cases, the union's position is that it =accepts job evaluation only as an initial decision technique and reserves the right to appeal the actual job-pricing decisions through grievances or bargaining channels.

Question 73

Executive compensation tends to emphasize performance incentives more than

A)pay plans for boards of directors.
B)pay plans for boards of trustees.
C)stockholders' pay plans.
D)pay plans for boards of governors.
E)other employees' pay plans.

Question 74

The two bases upon which to pay employees are increments of performance and seniority.

Question 75

The following are all elements in a manager's compensation package except

A)long-term incentives.
B)salary.
C)commission.
D)short-term incentives.
E)benefits.

Question 76

The "wage gap"between men and women is a result of systemic discrimination, as well as all of the following except

A)differences in hours worked.
B)education levels.
C)performance levels.
D)experience levels.
E)level of unionization.

Question 77

The Employment Equity Act provides unemployment compensation for up to 65 weeks for all Canadian workers.

Question 78

Job evaluation involves an informal and unsystematic comparison of jobs to determine the worth of one job relative to another.

Question 79

Executive, administrative, and professional employees are included in the overtime requirements of employment/labour standards legislation.

Question 80

When compensating professional employees, most employers use a

A)job evaluation approach.
B)skill-based pay approach.
C)market-pricing approach.
D)job-based pay approach.
E)pay equity approach.